Minnesota unemployment crunch easing
by Bill Catlin, Minnesota Public Radio
May 18, 2004

Kayleen Caulfield is trying to launch a consulting business, doing event planning and fundraising, but she has also tried to find work in finance, where she's got years of experience.
(MPR Photo/Bill Catlin)

Minnesota's job market improved dramatically in April. The state's unemployment rate fell to 4.1 percent. The decline was the largest ever. The state's economy added more than 12,000 jobs -- the most in several years. But job seekers say there's still a lot of competition for work.

St. Paul, Minn. —
The April jobs report is full of superlatives.
The hard-hit manufacturing sector posted its biggest employment gain in over a decade, 4,500. The state added 12,100 jobs total, the most since October 1999. And
Steve Hine, a state labor market expert, says the jobless rate fell by the most on record, .07 percent.

"In addition, the decline in the number of unemployed, a decrease of over 18,000 over the month was also the largest drop on record. And so, there's certainly strong evidence here to suggest that unemployment's finally started to recede," he said.

The April bounce in employment follows a lengthy decline. Minnesota still has far fewer jobs now than it did when the recession officially began in March 2001. But even when the economy started improving, the state and the nation continued to lose jobs. Hine says Minnesota has just regained the jobs lost during the economic recovery that began about two-and-a-half years ago.

"April's job growth was enough to put the state above the employment level of November 2001, when the recession officially ended. In other words, we've now regained the 17,700 jobs that we lost during the recovery, and now we can start regaining the 33,100 jobs that we lost during the nine-month recession of 2001," he said.

You can see the recent strength and prolonged weakness of the job market at the Minnesota Workforce Center in St. Paul. About a dozen job seekers work quietly, faxing resumes or looking for leads on computers.

Chris Stoehr, who works with employers looking for workers, says the list of jobs has grown a lot.

"We had 211 today, which is outstanding. I would say maybe a month ago, maybe two months ago, probably maybe 70, 80. So, it's nice to see pages and pages," Stoehr said.

Still, she says, it's a buyers market.

"There is no competition for 'if I pay, I'll get a better qualified candidate,' because they don't have to offer a whole lot to get a whole lot of resumes," she said.

That's the experience of Kayleen Caulfield, who describes the job market as "frightening."

Caulfield is trying to launch a consulting business, doing event planning and fundraising, but she has also tried to find work in finance, where she's got years of experience.

"The last place that I interviewed, they had 300 resumes and they dwindled it down to seven. And I just know that my resume is 50, 100, 300," she said.

The latest job numbers offer some hope the tide may be turning for people like Caulfield. The biggest employment gains came in the professional and business services sector, which added 5,100 jobs, including a significant increase in jobs related to management of companies. The manufacturing sector added 4,500 jobs.

Scott Thiss, head of S&W Plastics in Eden Prairie, says manufacturers found they had to add staff to keep up with rising demand for their products, but he says lack of confidence keeps many reluctant to hire. He gives the example of his firm's effort to find a mold-making supplier.

"Over the last three years we could call up somebody and get on their schedule immediately. Last week we couldn't find somebody that wasn't busy. Completely busy. Through June. But then they said, 'then we don't have anything on our calendar,'" Thiss said.

After several tough years, Thiss says companies don't yet have full confidence that June isn't "the edge of the earth."

And state labor market expert Steve Hine says there are other clouds of doubt; the prospect of rising interest rates, higher energy prices, the troubles in Iraq, which have triggered declines in the stock market.

In short, he says, Minnesota's April jobs report is what a turnaround would look like, if it persists into the future.